Results First Quarter 2012/13

Transcription

1 Results First Quarter 2012/13 Investor Call Mannheim, 27 th June 2012 Dr. Michael Majerus CFO

2 Disclaimer 2012 PHOENIX Pharmahandel GmbH & Co KG This document has been prepared by PHOENIX Pharmahandel GmbH & Co KG (the Company and, together with its subsidiaries and affiliates, PHOENIX ) solely in connection with the release of the results of the first quarter 2012/13 and is being presented solely for informational purposes. No representation or warranty, express or implied, is or will be made in relation to, and no responsibility is or will be accepted by the Company or any of its respective affiliates, advisors or representatives (together, the Parties ) as to the accuracy or completeness of the information contained in this document, and nothing in this document shall be deemed to constitute such a representation or warranty. None of the Parties or their respective agents, directors, partners and employees accept any liability whatsoever (in negligence or otherwise) for any loss or damage howsoever arising from any use of this document or its contents or otherwise arising in connection therewith and no reliance should be placed on the information or statements made herein. This document does not constitute or form part of and should not be construed as a recommendation, offer or invitation for the purchase or subscription of any securities of the Company or any subsidiary, and neither this document nor anything contained herein shall form the basis of, or be relied upon in connection with, any contract or commitment whatsoever. The information contained in this presentation has not been subject to any independent audit or review. A portion of the information contained in this document, including all market data and trend information, is based on estimates or expectations of the Company, and there can be no assurance that these estimates or expectations are or will prove to be accurate. In addition, past performance of PHOENIX is not indicative of future performance. The future performance of PHOENIX will depend on numerous factors which are subject to uncertainty. Certain statements contained in this presentation that are not statements of historical fact, including, without limitation, any statements preceded by, followed by or including the words targets, believes, expects, aims, intends, may, anticipates, would, could or similar expressions or the negative thereof, constitute forward-looking statements, notwithstanding that such statements are not specifically identified. In addition, certain statements may be contained in press releases, and in oral and written statements made by or with the approval of the Company that are not statements of historical fact and constitute forward-looking statements. Examples of forward-looking statements include, but are not limited to: (i) statements about future financial and operating results; (ii) statements of strategic objectives, business prospects, future financial condition, budgets, projected levels of production, projected costs and projected levels of revenues and profits of the Company or its management; (iii) statements of future economic performance; and (iv) statements of assumptions underlying such statements. Forward-looking statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions which are difficult to predict and outside of the control of the management of the Company. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements. You should not place undue reliance on these forward-looking statements. All subsequent written and oral forward-looking statements attributable to the Company or any person acting on its behalf are expressly qualified in their entirety by the cautionary statements referenced above. Forward-looking statements speak only as of the date on which such statements are made. The Company expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statement to reflect events or circumstances after the date on which such statement is made, or to reflect the occurrence of unanticipated events. 2

3 Highlights of PHOENIX group s 1 st quarter 2012/13 Stable business development Based on a stable business development in 2012/13, PHOENIX once more confirmed its position as leading pharmaceutical distributor across Europe Turnover is influenced by the flat development of the pharmaceutical markets Gross profit in percent of net turnover increased from 8.99% in the previous year s 1 st quarter to 9.65% in 2012/13 When adjusted for the dissolution of accrued transaction costs (EUR 18.4m) due to the premature refinancing, the profit for the period is slightly above the level of the prior year s first quarter Investments into fixed assets are made primarily in order to further optimize the PHOENIX distribution network and to further enhance the attractiveness of our retail shops across Europe In retail, the rebranding to BENU has successfully started 3

4 Despite increasing market pressure, PHOENIX shows growth in gross profit Revenue Gross Profit EBITDA Profit for the period (m ) 5,500 5, (-4%) 5,197 (after tax, before minorities) 2012/13 adjusted for premature dissolution of accrued transaction costs 5,000 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1, / / / (+3%) / /12-6 (-4%) / /12 +1 (+2%) /13 4

5 Successful refinancing 2012 Sound group financing On 21 June 2012, PHOENIX concluded a EUR 1.35bn syndicated facilities agreement with 15 German and international banks The maturity of the new facility is four years (term loan; EUR 300m) and five years (revolving credit facility; EUR 1.05bn), respectively The existing syndicated facilities agreement from 2010 (originally EUR 2.6bn; reduced to EUR 1.485bn) will be prematurely redeemed Thanks to the new agreement, PHOENIX group further enhanced its entrepreneurial freedom The successful refinancing was strongly supported by PHOENIX group s attractive business model and the consequent reduction of indebtedness in recent years PHOENIX group has a well-diversified corporate financing structure Both Standard & Poor s as well as FitchRatings have published company ratings of BB with stable outlook for PHOENIX 5

6 Despite the challenging market environment, the P&L shows an improved gross profit and adjusted profit for the period Profit & Loss (in m ) * 2011/ /13 Share of net turnover Delta in % Net turnover 5,397 5, % -3.7% Cost of goods sold -4,912-4, % -4.4% Gross profit % 3.4% Other income % 5.0% Personnel expenses % 6.3% Other operative expenses % 6.3% Result from associates and other invest % 1.7% EBITDA % -4.4% Depreciation % 5.7% Financial result % 41.7% Profit before taxes % -28.8% Income taxes total % -32.4% Profit for the period % -27.3% Adjusted profit for the period* % 1.9% Developments Despite turnover reduction, gross profit improved as a result of margin-oriented sales policy, additional higher-margin revenue, and the increasing share of retail business Gross profit improvement does not allow to fully compensate increased personnel costs (+15.8 m vs. PY) and other costs (+8.5 m vs. PY) due to normal progression of wages and transport costs, but also due to pharmacy acquisitions within Norway and the Netherlands, as well as wholesale acquisitions in Italy The financial result is influenced by the early refinancing of PHOENIX group and the corresponding one-time effect of the dissolution of transaction costs (-18.4 m ). Excluding these costs, the financial result has improved thanks to the reduced net debt and better financing conditions Tax rate is also improved from 30.5% to 29.0% In consequence, the adjusted profit for the period is slightly above the level of the prior year s first quarter * Adjusted for the dissolution of accrued transaction costs due to premature refinancing 6

7 PHOENIX group s optimized financial structure improves the interest result Financial result (in m ) 2011/ /13 Delta Developments Interest income Interest expenses Interest result Dissolution of transaction cost due to premature refinancing Other net financial result* Financial result Reduction of interest income due to lower interest from customers Lower interest expenses are mainly driven by reduced debt and optimized interest rates Most influencing factor is the premature refinancing of PHOENIX group, resulting in the dissolution of corresponding transactional cost * Other net financial result comprises other financial income and expenses, financial income and expenses from derivatives as well as exchange rate gains and losses related to the financial result 7

8 PHOENIX continues its committed path of strengthening its balance sheet (m ) 01/31/ /30/ , ,302 Developments 2,847 Inventory 1,695 Trade receivable 2,534 2,036 1, Trade payable 2, % 26.1% 2,901 Inventory 1,727 Trade receivable 2,445 2,089 1, Trade payable 2, % 27.0% Financial liabilities slightly increase due to seasonally higher net working capital Equity ratio further improved by profit for the period and reduced balance sheet total Slight growth in inventories due to seasonal effects Trade receivables and also trade payables decreased due to lower turnover Overall, despite absolute increase of NWC (+138 m ), on average NWC days are still lower than previous and year end: NWC days 2011/12: 40.0 NWC days YE 2011/12: 39.9 NWC days 2012/13: 38.6 Assets E & L Assets E & L Balance ratio Financial Liabilities Cash & Equivalents Equity Net Working Capital Other 8

9 Net Debt has significantly improved compared to previous year (m ) 04/30/2012 Developments Current financial liabilities Non-current financial liabilities 2,089 1, , ,050 Reclassification of SFA within current financial liabilities Net Debt reduction of 335 m compared to 2011/12: Reduction of net financial liabilities by 305 m Reduction of ABS/factoring by 35 m Delta /30/2011 Current financial liabilities 2, , ,385 Non-current financial liabilities Financial liabilities Cash & cash equivalents Net financial liabilities Supplementary partner contribution Derivative liabilities and other securities Net off balance ABS/ factoring Net debt 9

10 The renewal of the syndicated bank facilities improves the maturity profile Financial Breakdown facilitiesof and facilities headroom Debt maturity profile (m ) 3,000 SFA /30/2012 SFA 2010 revolver SFA Italy 4,500 4,000 3,500 3,000 Not drawn 825 Not drawn 750 Partly not used 2,500 2,000 1,500 1, SFA Italy Bilateral lines ABS/Factoring Bond SFA 2010 SFA 2012 Bilateral lines ABS/ factoring 2,500 2,000 1, ,063 Partly not used Partly not used 0 1,500 u.f.n 2012 SFA Bond SFA 2010 term loan 1, , u.f.n Diversified financing structure Significant financial headroom and efficient utilisation of cash allowed reduction of credit lines Renewal of SFA extends the duration and better distributes the maturities 10

11 The active management of net working capital shows significant improvements (m ) Days (average) +3.9 days ,606 1, , , days , , /11 Trade payables 2011/ / , days , , / /12 Inventories 2012/ / / /13 Trade receivables -2, , , / /12 NWC 2012/ days Key Achievements Slight increase in stock (due to acquisitions in Italy) Decrease of trade receivables due to lower turnover, but also ongoing local optimization Payables absolutely decreased (lower turnover), day wise significantly improved Overall, significantly improved NWC Balance sheet figures as externally reported Net working capital days: Average figures for the respective period; figures including ABS/factoring; may include rounding differences 11

12 The cash flow for the first quarter shows a negative free cash flow as expected due to seasonal swings Profit for the period Non-cash expenses/ income, interests, taxes, and dividends Changes in working capital Cash flow from investing activities Free cash flow (m ) = / / / / / / / / / /13 Cash flow development Typical seasonal cash flow swings by PHOENIX (example FY 2011/12) Lower profit for the period due to increased operational costs and increased negative financial results by dissolution of transaction costs due to premature refinancing Second column is especially higher due to effect of transaction costs Seasonal increase in net working capital, but substantially improved compared to previous year Cash flow from investing activities on normal level, slightly increased due to investments in fixed assets Free cash flow negative - as expected - but on a better level than previous year /12 Q2 2011/12 Q3 2011/12 Q4 2011/12 FY 2011/12 12

13 Summary: Development of key credit indicators 01/31/ /30/2012 Delta in % Equity (in m ) 1, , % Equity Ratio 26.1% 27.0% 3.3% Net Debt (in m ) 1, , % Gearing (Net Debt/Equity) 95.9% 104.1% 8.6% 2011/ /13 Delta in % EBITDA (in m ) % EBITDA-Margin 2.5% 2.5% -0.7% Adjusted EBITDA* (in m ) % Adj.-EBITDA-Margin* 2.7% 2.6% -7.1% Net Debt / Adjusted EBITDA* (LTM) % Interest Coverage Ratio (EBIT / Interest Expenses) % Profit before tax (in m ) % PBT-Margin 1.4% 1.1% -26.1% Profit after tax (in m ) % PAT-Margin 1.0% 0.8% -24.5% Adjusted profit after tax (in m )** % Adjusted PAT-Margin 1.0% 1.0% 5.5% * Adjusted EBITDA according to Bond definition LTM = Last twelve months ** Adjusted for the dissolution of accrued transaction costs due to premature refinancing 13

14 After a decrease in fall 2011, the price of the PHOENIX bond is now back at approx. 110% of the nominal value PHOENIX PIB Finance BV EUR 506,150,000 9,625% Guaranteed Senior Unsecured Notes due Price Yield (%) Price Yield (%) Date till 06/26/

15 The good performance of the PHOENIX bond starting Oct' 11 is shown by the spread to the high yield index iboxx High Yield Non-Fin PHOENIX Credit spread* (in bp) bp Jul 10 Jan 11 Jul 11 Jan 12 till 06/20/2012 * Yield to maturity minus swap rate 15

16 PHOENIX group with unchanged stringent financial policy Deleveraging strategy Further deleveraging is integral part of PHOENIX s financial policy and is backed by its main shareholders Net Debt/EBITDA target of around 3.0x PHOENIX is confident to reach its leverage target in the next two years Carefully managed acquisition activity PHOENIX s growth strategy is focused on above market organic growth Profitable and financially sound add-on acquisitions (mainly pharmacies) may also be pursued, but only within a predefined acquisition budget 16

17 Financial calendar 2012/13 Reporting Event Date 1 st Half-Year Results 09/27/ /13 3 rd Quarter Results 12/20/

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